Consumer prices rose 2.8% in February compared to last year, a little loose the first month under President Donald Trump and offered greeting news for the market buried by the Global Trade War. The inflation cools more than the economist estimated.
The main stock index rose in early trading on Wednesday minutes after the release of the inflation report.
The price increase is slowing from the 3% inflation rate recorded in January, although inflation remains almost one point percentage higher than the Federal Reserve target of 2%.
The price of eggs, however, the symbol of the price increase that is closely monitored, jumped 58.8% in February compared to last year, the faster than the previous month. Bird flu has destroyed the supply of eggs, lifting higher prices.
The Department of Justice opens an investigation of egg producers to learn if market practice has contributed to price increases, sources that are familiar with the problem told ABC News.
Prices fall for tomatoes, cereals, cupcakes, and cakes for the past year. However, some food prices have increased faster than the overall inflation rate, including beef, biscuits, and apples.
An increase in housing costs contributed almost half of the price increase last month, said the US labor statistics. The decline in flight and gas ticket prices helps compensate for some increase in costs, the agency said.
The inflation report arrived a few hours after the US imposed a 25% tariff on steel and aluminum, encouraging the task of retaliation almost coincidence from the European Union and marked the latest escalation from trading tension.
The tariff is widely expected to increase prices for consumers, because importers usually deliver parts of additional costs to buyers.
The stock market has plummeted since Trump imposed tariffs in Mexico, Canada and China last week, led to a warning on Wall Street about the potential for economic decline. Within a few days, Trump delayed several tariffs in Canada and Mexico.
Reports on Wednesday can soften the pressure on the Federal Reserve, which bears the responsibility to maintain inflation under control.
Chairman of Federal Reserve Jerome Powell last week said the administrative rate plan was likely to increase prices for US buyers and retailers
The scale and duration of the tariff remain unclear, but some of the import tax may reach consumers, Powell told an economic forum in New York City last week.
“We are at a stage where we are still very unsure about what will be deprived, for how long, at what level,” Powell said. “But it is likely that some of them will find the way. It will affect exporters, importers, retailers and to some extent consumers.”
On several occasions in the last few days, the White House refused to put aside the possibility of a recession, saying the tariff would require a “transition period.”
A worker moved a steel product in North York Iron, a steel supplier in Toronto, Ontario, Canada, February 11, 2025.
Cole Bursston/AFP Via Getty Images
Solid and disappointing job reports on Friday exacerbated concerns among several observers.
Employers employed 151,000 workers last month, not meeting the expectations of 170,000 work added. The unemployment rate beats up to 4.1%, which remains a historically low number.
Trump administration slapped 25% of goods tariffs from Mexico and Canada, as well as 10% rates for imports from China. New Rounds for Chinese goods duplicated the initial tariff set placed in China last month.
A day later, Trump issued a one -month postponement for automatic related goods tariffs from Mexico and Canada. The steel was expanded immediately afterwards with an additional one-month pause for items from Mexico and Canada in accordance with the United States-Mexican-Canadian agreement, or USMCA, a free trade agreement.
On Tuesday, Trump announced plans to add another 25% tariff to Canadian steel and aluminum, so that the total was 50%. The move came in response to the threat made by ontario to cut electricity into US sections, Trump said.
A few hours later, Ontario Prime Minister Doug Ford issued a joint statement with US Trade Secretary Howard Lutnick on X announced a suspension of an additional 25% cost for electricity sent to the US
The tariffs slapped in Canada, Mexico and China are widely expected to increase prices paid by US buyers, because importers usually deliver part of higher tax costs to consumers.
The main gauge of consumer confidence registered its biggest monthly decline since August 2021, a non -partisan conference council said in February.
The consumer section that expects a recession in the next year to surge to the highest nine months, the data shows. The portion of consumers who continues to be sure of the work market will deteriorate, the stock market will go down and interest rates will rise, the report added.
ABC News’ Katherine Faulders and Soo Youn contributed to this report.